Stakeholder Responses to the US-China Rivalry Reshape Southeast Asia's Trade
Summary
The US is pressuring allies to impose secondary tariffs on Chinese exports and discourage imports of Chinese goods, raising the risk of sudden tariff changes and stricter customs rules for Southeast Asian countries suspected of transshipment.
China has responded by demanding concessions, threatening to cut global supplies of essential resources, and extending Belt and Road Initiative loans to Southeast Asia, expecting the use of Chinese contractors.
Southeast Asian governments like Vietnam and Malaysia are adopting new compliance measures—digital certificates of origin, “Golden Lists” of restricted Chinese inputs—to navigate US demands while preserving ties with China.
Major multinational firms have started shifting production to India or Mexico to reduce Chinese content, while investment in digital origin certificates and blockchain authentication is growing to ensure transparency and avoid future sanctions.
Financial institutions and investors are adjusting portfolios in anticipation of rising costs, tariff threats, and potential supply chain disruptions, prompting central banks to stabilize currencies and protect credit ratings.
Media coverage and surveys in Southeast Asia indicate public concern over both US disapproval of Chinese involvement and China’s leverage, creating pressure on governments to strike a careful balance.
Businesses that can strategically diversify their supply chains, strengthen compliance, and proactively engage with regional policymakers are best positioned to capture new opportunities and mitigate the risks posed by intensifying US-China rivalry.
